You’ve searched for the perfect commercial investment space, gone through the necessary steps to purchase it, and suffered through lengthy renovations and building improvements. After months of hard work and stress, it can be tempting to fill your building with the first tenants that come along, but that could be a costly mistake.
When tenants sign a lease with you, you’re agreeing to an ongoing mutual relationship that will hopefully last for many years. Tenants that are responsible and profitable will be the key to your success, but it’s also important to find tenants that are a good fit for your space so that the arrangement is in the best interest of everyone involved.
In this blog post, we will share six tips to keep in mind as you begin to fill your commercial space with tenants that ensures a better chance of smooth leases and great tenants for years to come.
- List Your Property Correctly
With so many different types of commercial real estate, you may be unsure as to what category your property fits into. The first step in listing your property correctly is to find out what it is zoned for. If you are listing a building zoned for industry as office space, you are obviously going to be attracting the wrong type of tenant. When you are clear on zoning, take your research even further. Learn from any prior vacancies. Ask surrounding businesses about what sort of businesses have done well in the location and which seemed to close prematurely. Adding a suggested use for the property in your listing will help to engage an audience that is more likely to thrive in the space, therefore minimizing the chances that the lease will be broken. Another key factor in listing your property is ensuring that it is priced appropriately for its location. Research other comparable spaces in the area so that you can put your property on the market competitively.
- Highlight the Positives
Whether you are leasing retail space, offices, or are on the hunt for warehouse tenants, it’s important to emphasize the best characteristics that will appeal to your perfect tenant. Don’t hide any negatives but be sure to highlight the positives in any listing or other marketing materials. For example, convenient parking and foot traffic would be appealing for a new boutique, while building improvements or ample parking for employees may be important to a larger business looking for office or warehouse space.
- Look Into Tenant Finances
Showing your commercial real estate property to potential tenants is all well and good, but if you aren’t screening them properly, it may be for naught. Whether you are working with a broker or have chosen to show the property yourself, knowing how much capital a viewer is bringing to the table will help to save you lots of time and energy in the long run.
- Keep Up With Prior Tenants
Maintaining a positive relationship with any prior tenants you have had is a great way to attract the right future tenants. The fact is, people talk, and nobody wants to rent commercial real estate from a landlord with a negative reputation. Make a positive name for yourself by making repairs as they are necessary, keeping the lines of communication open with your tenants, and being willing to stay open to any suggestions they may have in regards to the property.
- Educate Yourself on Surrounding Businesses
Knowing what else is around your commercial real estate property is another great way to make sure that you are appealing to the right sort of tenant. Watch other businesses and notice which ones seem to be thriving and which appear to be falling short of their business goals. Notice what types of competition are in the area that may draw away from your tenant getting the visibility they will require. As mentioned earlier, having a gauge of which types of properties are more likely to flourish in your particular area will help to captivate the right types of tenants. This also shows potential tenants that you have done your homework and are as invested in their success as they are.
- Find the Appropriate Broker
As you can see, there are many components to be considered when it comes to drawing in the right tenant for your commercial real estate property. Working with a qualified broker who is well-educated on the market in your area takes out the majority of the guesswork and helps to guarantee your success as a landlord or investor in commercial real estate. Look for a broker who is familiar with your particular genre of commercial real estate and who has a proven track record when it comes to negotiating leases successfully.
